Rarely will I rush to post a link to another article, but this one is great. I go to KenRockwell.com to check out photography reviews all the time, and sometimes he’ll post other items of interest. His article appears here:
http://www.kenrockwell.com/tech/how-to-afford-anything.htm
I agree with most of what he says, with a few points of my own:
- I agree, you have to skimp in some ways to spend in others. I managed to do this throughout college, I’m not sure how but I was able to be cheap in some ways to spend on things I wanted to do (I just hid the cheapness).
- I’m not a believer that saving creates wealth. I don’t think that wealth is created by cash in the bank but by assets that generate revenue (the Kiyosaki method). I don’t think the point of this article is that you can save your way to wealth, but rather that you can make smart decisions when acquiring things.
- Obviously Ken likes cars and cameras. So he makes sacrifices. But don’t think because he doesn’t like a beer with his restaurant dinner that you have to also. Find your own mix!
- What he says about tipping is totally true. It’s like they say in “The Secret” – charitable giving (and tipping) somehow gets returned quickly. I’m not sure how (law of attraction??). But its important to gift well and give well.
- No doubt you need a 4-year degree if you want to be well-rounded. But recently I’ve been more and more under the impression that people who learn a trade will always be better off than those that get into corporate careers with no identity. I don’t think there is shame in being a carpenter or an electrician. Its union and if you want to make more money, just work more. Then hire, train, and sit back and have a mojito while your business works for you ;)
- Is it really irresponsible to take advantage of low interest rates to float low debt? The jury is still out on that in my book. If I can float a huge purchase at zero percent over 12 months then I’ll usually take that deal. It’ll let me build more cash on hand. If I have a $5000 expense for something and there is a chance to pay over time then why not take it? I think the secret to this is to know you have enough to cover it anyway. If its free to borrow and you can earn interest on it yourself, I don’t see the harm. Just because the credit company thinks you’re gonna default and pay huge fees doesn’t mean you have to.
- Like I said in my first point, skimp in some areas to spend in others. We built a 16*26 patio with paver stones and a retaining wall and all it took was $4500 in materials and some favors from family. But it was done for about 1/3 the cost of what a contractor would’ve charged, and it added a nice value to our house. What a deal! With what’s left over we had a great vacation in Aruba (at a timeshare that was abandoned by someone else, less than $90/night for a huge apartment w/ 2 baths, but that’s another story), saved a ton of cash and I lost like 15 pounds doing it. This doesn’t mean I do everything myself. I’m not really that handy. In the end, its all a math exercise – if you can better monetize your time, then hire someone else to do it!
POSTSCRIPT: While I am thoroughly pleased with the defeat of the NY Rangers – I’m not wasting another post on those guys. WTG Pens!
